Recession and motivation factors in the workplace in the UK

Abstract

This dissertation is concerned with recession and the effects it has had on the motivation factors in the workplace. In 2008 the government announced during the duration of the second quarter the UK would go through a small recession, this was known as the 'Credit Crunch', this however is now carrying on peaking in to the late 2010. This recession has created a number of problems such as an increase in redundancy numbers and also an increase in the unemployment rate. A recession can have a negative impact on people. The evidence in my writing indicates that the recession influences the way employees are motivated at work. The topic area that has been chosen is motivation, as this is the main factor that is important for any employees and employers that are working for any business. This will be carried out and will be explained in detail what is motivation and how is it important for the business. Motivation is an understanding within the business and is expressed in every different level for employees; the researcher will define motivation for the purpose of this. "A state arising in processes that are internal and external to the individual, in which the person perceives that it is appropriate to pursue a certain course of action (or actions) directed at achieving a specified outcome (or outcomes) and in which the person chooses to pursue those outcomes with a degree of vigour and persistence"

Rollinson (2002).

This research shows the expectations of motivation and how peoples needs and their expectations of working in a busy and successful environment and what their role is and how they are motivated.

Introduction

This chapter will introduce the topic of recession and employee's motivation in the workplace and set out the aims and objectives of this research paper.

The recession and the cause

In the second half quarter the UK economy began to suffer, this resulted into a recession. A recession is known as a decline in the Gross Domestic Product (GDP). As the recession took place this was also known as a credit crunch but the later on discovered that is was a recession that was taken place.

Objective

The aim of the writer is to research motivation and the use of motivation in the workplace. The importance of motivation procedures are carried out to ensure that the main focus is to see how effective the monetary policy is and how it may be related to motivation so that the research can see whether money is the factor due to the recession. This is known as a reward and incentives scheme in a working environment. To measure the importance of the monetary there are also other factors that will be discussed to see whether the monetary factor in relation to other non monetary factors.

Research Objectives

A breakdown is given of the two types of research methods, positivism and interpretivism and details are provided of the type of research methods that have been used for this paper, in order to gather specific and accurate details to prove whether or not motivation is the key factor in the working environment. The writer discusses the research methods in relation to the use of a survey they have conducted as part of a case study, which was realistically practical and workable for the researcher.

Writers and their Theories

The researcher investigates a variety of writers and their theories based on motivation.

F.W Taylor (1911) Scientific Management idea was, and still is influential to today's organisational behaviours. F.W. Taylor pursued a theory to explain what encourages people of give of their best in the work situation. Taylor put forward the view that people were primarily motivated by money since it lies at the root of most of their problems. Taylor's key principles encouraged work productivity when the conditions provided gave them a chance to receive a bigger wage package. These are as follow:

Some form of work measurement. - for example items per shift which could be counted/recorded

Some standard of performance

Direct financial incentives - so that the worker gets a fatter wage packet for producing more.

Taylor's ethics include the workplace management are constantly watching employees otherwise production will slow down or come to a stop, and employees are money motivated.

The different theories of motivation can be divided into two contrasting groups. Content theories concentrate on what motivates and are concerned with people's needs and strengths and the goals they pursue in order to satisfy those needs. The theories include:

Maslow's hierarchy of needs model

Alderfer's modified need hierarchy model

Herzberg's two-factor theory

McClelland's achievement motivation theory

Process theories of motivation emphasizes on the actual process of motivation. They are concerned with the relationship between the dynamic variables, which make up motivation, and how behaviour is initiated, directed and sustained.

Motivation may reflect in different ways, in different places with people, this also results to for different reasons. As a result, this research continues to hypothesise that "due to the recession is money the key motivating factor".

Chosen Organisation

Various organisations use a selection of reward schemes to motivate their staff to increase performance. The writer will be mainly focusing the research on Central Claims Group (CCG). The organisation is based in Bury and is an outbound call centre. The call centre provides a service to the public to help them claim compensation depending on any injuries that have happened during the previous years. Call centres have a monetary rewards bonus/commission scheme in operation. The objective of the research will be to investigate CCG staff participants in order to identify what motivates these people to go to work.

It is investigated how effectively the reward system in the organisation contributes to the actual motivation of its employees. The research will follow through and find out whether the employees consider that monetary rewards are the key factors of motivation in the business. The writer is only analysing a small area of the employees that are working at CCG so that there is a better understanding of the research.

Summary

Based on support of scientific theories of motivation with works from Maslow, Alderfer, McClelland F.W Taylor and Herzberg's theories the researchers own views have been included. Most of these theories can be used in different aspects/points of an individual's life. But those theories are mainly related to motivation in the working atmosphere. The researcher will review how their research has achieved or hasn't achieved their objective in finding and illustrating their hypothesis on "due to the recession is money the key motivating factor" or not, and reflect on the writer's research with the aim to identify opportunities for further research.

CHAPTER II

LITERATURE REVIEW

Literature Review

Introduction

The researcher will discuss the importance of motivation and what are others perception of motivation as well as a number of different factors related to motivation and the working environment. It will be determined that money is the main factor in motivation, this does not mean that this is right or wrong as this can depend on different organisation amongst different business and social cultures. This will be followed by other motivating factors in the workplace and the researcher refers to various experts and their theories of motivation in the workplace. To conclude the researcher will conclude the review with a personal statement on the application of motivational techniques in the workplace.

Importance of Motivation

Mullins (2004) defines motivation as "some driving force within individuals by which they attempt to achieve some goal in order to fulfill some need or expectation."

Motivation is essential factor needed in an organisation as it affects the employee and employers performance. The emphasis of this review is looking at the goals of the organisation.

Motivation also has a strong impact on an individual's job role. It is particularly significant to managers to "motivate" their teams as they have a direct control of, which are;

Selection Process

Training and Development

Skills and Knowledge

Job Design

Managers will focus on these points to motivate employees by controlling the environment around them and provide the necessary requirements in terms of skills, abilities, enablement, encouragement, empowerment and opportunities to ensure the employee's needs are satisfied. This will make the employees want to apply their commitment and dedication to their job making the manager's aims and objectives achievable. Motivation is expressed as the driving force within an individual, which prompts them to achieve a certain goal or target. This will then threefold classification of individual needs and expectations at work is economic, intrinsic and social.

Extrinsic relates to tangible rewards, for example salary, fringe benefits, promotion, contract of service, work environment and working conditions. The important thing to remember here is that such tangible rewards are often decided at organisational level and are therefore outside the control of individual managers.

Intrinsic relates to what has been described as "psychological" rewards. For example, the opportunity to use ones ability, a sense of challenge and achievement, receiving words of appreciation, positive recognition and being treated in a caring and considerate manner. If somebody's motivational driving force is being blocked in some way before she or he reaches their desired goal then this can result in frustration-induced behaviour which can manifest itself in 'aggression', 'regression', 'fixation', and 'withdrawal' (Freudian concepts).

There are many competing theories that try to explain motivation at work, none of which are conclusive and all of which have their critics, however, it is because of the complexity of motivation that these theories are important to the manager. They show that there are many motives that affect people's behaviour at work. They provide a framework within which to direct attention to the problem of how best to motivate staff so that they work willingly and effectively.

Krech et al (1962) states that motivation can be described in general terms as:

"Direction and persistence of action, it is concerned with why people choose a particular course of action in preference to others, and why they continue with a chosen action."

Mullins (2004) offers a broad definition for motivation to work:

Economic rewards (pay, fringe benefits etc) this is an instrumental orientation (Goldthorpe) to work and is concerned with 'other things'.

Intrinsic satisfaction derived from the nature of the work itself, for example, interest in the job itself, personal growth and development. This is called a personal (and sometimes bureaucratic) orientation to work and is primarily concerned with 'oneself'.

Social relationships cover things like friendships, group working, and desire/need for affiliation, status and dependency. This is relational orientation to work concerned with 'other people'.

The important difference here is that the "psychological" rewards can be determined by the actions and the behaviour of individual managers.

Traditional Motivator

Around the 1800 English philosopher Jeremy Bentham's developed the carrot and the stick approach. He believed that all people are motivated by desire to avoid pain and find pleasure. Bentham believed that any worker would only work if the reward packet was big and the punishment would be unpleasant. The 'carrot and stick' view is still to be found in the older more traditional sectors of the industry. Various leading theories of motivation make reference to the carrot and stick approach. The similarities are using rewards and penalties to encourage behaviour. The 'carrot' is recognized to be positive as and the 'stick' is seen to be negative. The theory derives from an old story to make a donkey move, one must put the carrot in front and dab him with a stick from behind. Rewards and punishment are still considered to be strong motivators till today.

The encouragement of the 'carrot' in motivation results in the worker getting money in form of pay or bonuses. However the problem with the 'carrot' approach that regardless of performance through such practices of salary increase and promotion by seniority, automatic 'merit' increases, and executive bonuses not based on individual manager performance. The 'stick' is a form of fear of losing a job, loss of income, demotion or some other penalty continues to be a strong motivator.

The financial factor has become the secondary factor to motivation as other factors like job satisfaction and personal development seem to be on workers mind nowadays. Many more individuals have a disposable income and do not think about saving as it used to be centuries ago. Resulting in people is able to afford to make career choices which mean less remuneration in order to gain lifestyle enhancements.

More people realise each day how much time they spend at work and ask themselves

"How happy am I in this environment?"

Today the great dual ambition is to have a satisfying job and a fulfilling personal life. Watson's (1982) theory suggests a reward balance is required for employees so their efforts to keep their motivational drive stimulated.

Also responsibility lies with managers to motivate their employees with designs of suitable program and pay packages.

Theories of Motivation

Abraham Maslow's "Hierarchy of Needs Theory" is probably the most widely mentioned theory of motivation. Maslow emphasised the importance of psychological growth. He proposed that human need to strive to achieve their full potential and that only when we are able to do this are we in good health psychologically. The Hierarchy ascends from lowest to highest needs, and only when achieved the first step can they move to the next. Maslow's theory consists of

Physiological needs :

These are needs for requires for the human life. Food, water, warmth, shelter, sleep, medicine and education are the basic physiological needs which fall in the primary list of need satisfaction.

Security or Safety needs :

These are the needs to be free of physical danger and of the fear of losing a job, property, food or shelter.

Social needs :

Since people are social beings, they need to belong and be accepted by others. People try to satisfy their need for affection, acceptance and friendship.

Esteem needs :

This kind of need produces such satisfaction as power, prestige status and self-confidence.

Self-Actualization :

Maslow regards this as the highest need in his hierarchy, achieving one's potential and self-fulfilment. It is to maximize one's potential and to accomplish something.

In order to meet self actualisation, each need is to be satisfied then the next need becomes dominant. When motivating employees it is required to understand the level of the hierarchy that person is focused on satisfying those needs or needs above that level. However it has been said that once self actualisation has been achieved an individual will find something else to achieve and will never actually become self actualised as they will thrive for more.

Clayton Alderfer's existence, relatedness and growth theory is a rebuilt version of Maslow's hierarchy model. The existence groups looks at providing basic material needs. The relatedness groups are looks at interpersonal relationship with other members and finally the third group growth is concerned with intrinsic desire and personal development at work. This theory in general looks at:

In an individual, more than one need may be operative at the same time.

If a higher need goes unsatisfied than the desire to satisfy a lower need intensifies.

It also contains the frustration-regression dimension.

David McClelland has developed a theory on three types of motivating needs:

Need for Power

Need for Affiliation

Need for Achievement

The need for achievement is seeking personal responsibility, attainable but challenging goals and feedback on performance.

The need for affiliation is concerned with the desire for friendly relationships, sensitivity to the feelings of others, preference for roles with human interaction. Social recognition and affiliation with others provides them motivation.

The need for power challenges success and the fear of failure. It also gives the desire to make an impact to be influential and effective. Such people are motivated to perform when they see at least some chances of success.

McClelland observed that with the advancement in hierarchy the need for power and achievement increased rather than Affiliation.

Frederick Herzberg's motivation-hygiene theory is a modified version of Maslow's hierarchy of needs. Herzberg's theory is also known as the two factor theory. There are intrinsic and extrinsic factors related to job satisfaction and dissatisfaction. His theory was devised on the question "What do people want from their jobs?"

Motivation, says Herzberg, derives from people having a sense of achievement, recognition, responsibility and opportunities for personal growth. He criticises management for ignoring the motivational factors and trying to motivate through things like money and benefits - expensive and not successful.

Security, status, relationship with subordinates, personal life, salary, work conditions, relationship with supervisor and company policy and administration.

Examples of Motivational factors are:

Job advancement,

Responsibility,

Challenges,

Recognition

Achievements.

Herzberg says motivation derives from people having a sense of achievement, recognition, responsibility and opportunities for personal growth. He criticises management for ignoring the motivational factors and trying to motivate through things like money and benefits - expensive and not successful.

After viewing the way in which the manager dealt with employees, McGregor believes that a manager's view of the nature of human beings depends on a certain grouping of assumptions and that he or she tends to shape his or her behaviour towards subordinates according to these assumptions. Theory X falls under the negative category and theory Y falls under the positive category. The theory 'X' assumptions is concerned with people who dislike work so they try to avoid it work they can and have little ambition and desire security. Employees have to be controlled and directed and threatened with punishment in order to get productivity out of them. People are inherently lazy and must be motivated by outside incentives to work. This theory is similar to the 'carrot and stick' approach, however more like the 'stick' approach.

The Theory 'Y' assumption that work is as natural as play, self-direction and self-control and that motivation results from self-esteem and a sense of achievement; that most people seek responsibility. Given the right conditions employees will apply more physical and mental effort into their work.

Performance pay can be quite harmful in a working environment because it benefits anyone individual because he/ she will spend a great deal of time and effort on one particular are of work that will lead to the detriment of other colleagues. Especially in a situation where the job is complex, measuring performance on a true reflection with fairness is hard to evaluate.

Overall Theory X focus is on the lower needs that control individuals and theory Y focuses on higher needs that control individuals. Managers who use the Theory X approach tend to be authoritarian in nature, the word "authoritarian" suggests such ideas as the "power to enforce obedience" and the "right to command." As for Theory Y organizations can be described as "participative", where the aims of the organization and of the individuals in it are integrated.

Methodology

General Research

When trying to find data for a project, you need to have a structure to get as much information for the research. Saunders (2008) mentioned that you have to go through a number of stages in order to find a number of correct answers to your questions. This work is concerned on how to collect data for answering research questions. The diagram below show to do a successful research this is the structure required to achieve data for a specific project.

Research Philosophy

Research philosophy decides in which direction your research is going, from your own impressions about the development of knowledge (Saunders et al., 2008).

There are three main views when starting research which are positivism, realism and interpretivism. Positivism emphasise on structured methodology to assist replication with the end result being law like generalisations or numerical data.

The criticism of positivism is that human being and their feelings are absolutely disregarded and therefore a positivist cannot get a deep insight into a matter (Grossan, 2003).

Interpretivism unlike positivism takes into account of human beings feelings. However, perhaps the strongest argument that an interpretivist could mount is the necessity to discover what Remenyi et al. (1998:35) calls 'the detail of the situation to understand the reality or perhaps a reality working behind them'.

Finally Realism is a combination of positivism and interpretivism. It seeks to understand the existence of an external and an aim that influences peoples social interpretations and behaviours but may not be perceivable. It involves the people themselves and not the objects to be studied in natural science. There are two types of realism, direct and critical. Direct realism reproduces the truth in what you see unlike critical realism where your eyes can be deceived, you see something but in fact is the opposite of the truth.

Quantitative and Qualitative Research

Fitzgerald & Horcroft state, "Quantitative data is a use of mathematical & statistical techniques to identify facts and casual relationships. Samples can be larger and more representative. Results can be generalised to larger populations within known limits". Remenyi et al (1998, p331) further states, "for quantitative research it is usually obvious what evidence is required, and this evidence may usually be collected within a tight structure". Quantitative research involves research that uses structured questions and where the option of the answer is predetermined. It also has to involve a large number of respondents. This type of research can also collect numerical data which can be put into rank order, or in categories as well as the raw facts and figures being measured in units of measurement. The end result of the data can be constructed into graphs and tables of raw data.

Qualitative research involves collecting, analyzing, and interpreting data by observing what people do and say. Fitzgerald & Horcroft (1998, p313) state, "Qualitative data determines what things exists rather than how many there are. This is a less structured approach and is more responsive to the needs & nature of research situations". Bryman and Burgees (1994) state, "The qualitative approach assumes the world is socially constructed rather than objectively determined".

Research approaches

There are two methods to gain findings, Deductive and inductive. Deductive test the theory or hypothesis then further observations are collected which leads to a confirmation of original theories. It must be measurable and should be able to generalize to a wider population. Deduction consists of the relationship between two variables and should be measurable enabling the result to generalize to a wider population. The problem with this is time management as you require quantitative data and refers to positivism philosophy. The inductive approach is based on developing a theory on observation and empirical data using positivism philosophy. After collecting the data hypotheses are then formed and tested concluding with the formation of theories. According to Ali and Birley (1999) Inductive concentrates on how humans interpret their social lives.

Both deductive and inductive approaches will be used as there has previously been a lot research regarding this topic. Saunders (2007:22), believed 'the topic on which there is a wealth of literature from which you can define a theoretical framework and a hypothesis lends itself more readily to deduction. With research into a topic that is new, is exciting much debate, and on which there is little existing literature, it may be more appropriate to work inductively by generating data and analysing and reflecting upon what theoretical themes the data are suggesting.'

Research strategies

Research strategies is what method you use to find your research, the three common ways to carry out experiments are experiments, surveys and case studies. For this particular project, the best strategy would be a survey through a questionnaire via individual face to face because it will give quantitative data and qualitative data and it allows sending out a large number of samples with less time consumption than sending via post, telephone interviews. Another opportunity to get information is through case studies by observing participants or just interviewing them. This project the managers will be drawn up by interviews with specific questions as well as workers but separately to ensure anonymity. Here the staff can explain difficult questions if needed.

Time horizons

When all the appropriate data is collected, it is necessary to plan and the research will be carried out. A cross- sectional study would be used as the data gathered is limited in time and you get an insight into more than one case.

Triangulation

Triangulation is where there is a number of ways to collect the data, using multiple methods, theories or investigations.

Data collection and analysis techniques

Data will be collected via questionnaires and interviews will be examined carefully to obtain whether money is the main motivating factor at CCG. There will statistical analysis of the surveys by producing graphs and pie charts. Secondary data will be gathered via books, journals and the internet to locate the most effective management style used.

The author will be collecting data using questionnaires and interviews to get hold of research based on the beliefs, values, and attitudes of end users towards the new quality system at CCG. This will allow the author to make assumptions about the motivating factor applied at the call centre based on the data collected and make recommendations.

Questionnaire Design

Burgess (2001, p3) states, "A crucial part of good research design concerns making sure that the questionnaire design addresses the needs of the research. To put this another way; somehow we need to ensure that the questions asked are the right ones".

The development and distribution of questionnaires to users are known to be the new quality. These are for the individuals who were directly affected by the new system. Burgess (2001, p5) states, "Most researchers make the mistake of asking too many questions. This often arises from an incomplete analysis of how to meet the survey aims". In order to achieve the most information as possible, the author has to keep in mind the point made by Burgess when conducting the questionnaire Otherwise the questionnaire will not be relevant to the investigation and may become too long. The questionnaire will be structured so it is easy to read and understand when laid out in front of the respondent, therefore making it easy for the respondent as well as the researcher when analysing the data. Burgess (2001, p5) states, "Clear and concise questionnaires can help get the best response". By asking opened and closed questions the author will be able to generate some qualitative and quantitative data. Burgess (2001, p5) states, "Start your survey by setting down the aims for the survey". This point shows that in order to produce a good questionnaire the author needs to recognise the aims of the questionnaire by identifying certain questions that need to be answered regarding the new quality system. Burgess (2001, p3) states, "The basic process of survey research can be outlined as follows:

Define your research aims,

Identify the population and sample,

Decide how to collect replies,

Design your questionnaire,

Carry out the main survey,

Analyse the data".

Using Burgess six stages is the best way to carry out the authors questionnaire.

The method the author chosen is realism as the data that needs to be acquired needs to be both quantitative and qualitative. The collection of this data will allow me to get an insight in to numerical data and by thorough statistical analysis will show findings of the best used management style used. However the quantitative data will be a good indicator to show the individual perception of how the workers prefer to work in expresses themselves through an interview.

My questionnaires will be both qualitative and quantitative as some questions will only require yes/no answers and some questions will require longer detailed answers. The questionnaires will allow me to study what effects the current recession is having on consumers, businesses, shopping behaviour, savings etc. I expect my results to show that the current recession has had a negative impact on people's lives and also businesses.

There will be many advantages of using a questionnaire survey. These advantages will benefit my research and also aid me in my conclusion. Questionnaires are very cost effective when compared to face-to-face interviews. I will only need paper to implement my survey method.

Questionnaires are easy to analyse. Data entry and tabulation for nearly all surveys can be easily done with many computer software packages such as Microsoft Excel

They are familiar to most people. Nearly everyone has had some experience completing questionnaires and they generally do not make people apprehensive.

They will reduce bias. There is uniform question presentation and no middle-man bias. The researcher's own opinions will not influence the respondent to answer questions in a certain manner. There are no verbal or visual clues to influence the respondent. The people will who the questionnaire is given to will be able to fill them in at their pace and then give them back to me.

However, there are also limitations in using the questionnaire surveys of which I have chosen to do my research. I have worked to erase some of these limitations. Early limitations were that if I gave the questionnaires to people I know, which would have been easier, they probably lose it or not return the questionnaire. I have removed this limitation because I will be taking five minutes of each employees break to conduct the questionnaire and providing them with the necessary tools in order for them to complete the questionnaire. This will be beneficial to my research as it will ensure a quick response and also remove any worries of the questionnaire not returning back or getting lost. A minor limitation which can easily be eradicated is that some people may refuse to do the questionnaire.

Ethic

To respect the human rights and the confidentiality of all individuals, all information collected will be treated with the upmost confidence. For the researcher to use the information they will have to get a consent form signed from all the individuals so they are allowed to use the information. They will also be given a briefing before the questionnaire and a debriefing at the end so they can if not happy say no to they're data to be used.

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